Sometimes, a small loan could be a suitable solution to help you through a difficult financial period.
CashLady is a credit broker, and we have helped thousands of people search for an online short-term loan to help cover an emergency expense.
If you’re looking to borrow money, we work with a panel of direct lenders who offer short-term loans with repayment terms between 3 and 60 months.
What is a small loan?
A small loan is when an individual borrows a ‘small’ sum of money from a lender to help pay for an unexpected expense.
The definition of a small loan varies; what’s believed to be a small amount of money to one person may seem like a lot to somebody else. Typically, a small loan could be considered as an amount below £1,000.
If you’re approved to borrow a small loan, the funds will be sent to your bank account. You’ll then repay the money you owe in monthly instalments, which will include interest.
I need a small loan; what amounts are available?
With CashLady, you can search for a small loan starting from £100, all the way up to £10,000.
You should never borrow more money than you need or can afford to repay. Remember, when you take out a loan, you don’t just repay the amount you borrow - you’ll also be charged interest, which will be included in your monthly repayments. You should take the time to consider how your repayments will affect your monthly budget. You should not apply for a loan if repaying it will leave you unable to cover the cost of your essential outgoings, such as mortgage or rent, bills, and food shopping.
How long can I borrow a small loan for?
The lenders on the CashLady panel provide small loans with repayment terms between 3 and 60 months, depending on the amount of money you apply to borrow.
How much will a small loan cost?
This will depend on several factors, including:
- The amount of money you apply to borrow;
- Your chosen repayment term; and
- The interest rate you’re offered.
When searching for a small loan, you may notice something called the ‘Annual Percentage Rate (APR)’. This refers to the annual cost of borrowing and takes both interest and any standard fees into account.
We’ve included some examples of different small loan amounts and how much you could expect to repay based on a 12-month term and an APR of 79.5%.
| Loan amount | Repayment term | APR | Monthly repayments | Total interest | Total repayable amount |
| £200 | 12 months | 79.5% | £24.68 | £96.15 | £296.15 |
| £500 | 12 months | 79.5% | £61.70 | £240.39 | £740.39 |
| £700 | 12 months | 79.5% | £86.38 | £336.54 | £1,036.54 |
| £1,000 | 12 months | 79.5% | £123.40 | £480.77 | £1,480.77 |
Please be aware that these examples are for illustrative purposes only. We used this personal loan repayment calculator to get our results.
Could I get a small loan today?
There are some lenders, including several on the CashLady panel, who could send your money on the same day your application is approved.
Please be aware that same-day loans cannot be guaranteed; every lender will have their own payout timeframe, and the time it takes for the funds to appear in your account will depend on your bank’s policies and procedures.
Can I apply for a small loan?
Eligibility criteria will vary between lenders, but you can usually apply for a small loan if you:
- Are over the age of 18;
- Are a UK resident;
- Have a UK bank account and valid debit card; and
- Have a regular source of income paid into your bank account.
You can use CashLady to search for a loan if you meet the above requirements.
Small loans direct lender vs credit broker
Whether you apply for a small loan with a direct lender or search for one using a credit broker is entirely your decision.
We’ve included a brief overview showing the key differences between using a direct lender and a credit broker below.
Direct lender:
- Can check your eligibility for their product(s) only.
- Are required, in line with Financial Conduct Authority (FCA) guidelines, to carry out a creditworthiness assessment. This will include a hard search or Open Banking.
- A hard search will be visible on your credit file for up to 12 months.
- If your application is turned down by one direct lender, you might continue to make applications until you find one willing to consider you. This will result in multiple creditworthiness assessments, which may include several hard searches. Multiple hard searches within a short period of time will damage your credit score.
Credit broker:
- Work with a panel of lenders that they scan at the same time to search for a suitable loan for you.
- Will use soft search technology to search for a loan without harming your credit score.*
- A soft search will only be visible on your credit file to you and the company who carried out the check.
*If you’re matched with a loan through a credit broking service and choose to make a full application with the lender, a creditworthiness assessment will be carried out. This could include a hard search, which will remain on your credit file for up to 12 months. Undergoing multiple hard searches in a short space of time will cause your credit score to decline.
Search for a small loan with CashLady
Here’s what you can expect from the CashLady journey when you use us to search for a small loan.
1. Our online form should take no longer than five minutes to complete. You’ll be asked how much money you need to borrow and for how long, as well as some personal information such as your address history and employment status.
2. We’ll run a soft search and scan our panel of lenders for a suitable loan for you.
3. If we’ve been able to match you with a loan, you’ll be redirected to the lender’s website, where you can find out more and decide whether you’d like to make a full application.
4. If you’re happy with the loan we’ve found for you, the lender will carry out a creditworthiness assessment, and this will include either a hard search or Open Banking. As discussed, you should be wary of multiple hard credit searches being carried out in a short space of time, as this will have a negative impact on your credit score.
5. Once the creditworthiness assessment is complete, the lender will let you know the outcome. If approved, you’ll also be told when you can expect the money to be sent.
Important: the lender will send you a credit agreement, which will contain the terms and conditions of the loan, as well as your repayment schedule. You should take the time to read through this carefully before you decide whether to sign and return.
Small loans for bad credit
Worried about your credit score? You could still get a loan, even if you have a history of bad credit.
CashLady works with a number of lenders who specialise in loans for people for bad credit, although it’s important to be aware that you could be offered a higher interest rate. You could also face certain restrictions, such as being unable to borrow the amount of money that you need.
Small loans for people with no credit history
No credit history, often referred to as having a ‘thin’ credit file, usually affects those who have never paid bills in their name or borrowed credit before. This could be especially common in younger people.
A thin credit file could negatively impact your chances of being considered for a loan, and if you are approved, a no credit history loan could come with a higher rate of interest.
Several of the lenders on the CashLady panel are willing to consider applications from people with a thin credit file.
How will a small loan affect my credit score?
A small loan, like any credit product, will affect your credit score.
Depending on how your loan is managed throughout your chosen repayment term, the effect could be either positive or negative.
If you make your repayments in full and on time each month and clear the balance of the loan before the term comes to an end, you could notice an increase in your credit score. However, you should remember that various factors contribute to your credit score, and any existing credit commitments and bills will also need to be kept on top of.
A late or missed repayment will have an adverse effect on your credit score, and in addition to this, you may be charged fees by your lender.
Secured v unsecured small loans
As the name suggests, a small, secured loan requires you to ‘secure’ the money you’ve borrowed against an asset, such as your home or car. This is commonly referred to as ‘collateral.’ If you default on your repayments, the lender could seize the asset to recover the money lost.
Before you apply for any type of loan, you should be 100% confident that you’re able to make your repayments on time each month. Be mindful that falling behind on or failing to make a repayment on a secured loan could result in you losing whichever asset you’ve secured the money against.
With an unsecured small loan, you do not need to use an asset as collateral.
CashLady does not work with any lenders of secured loans.
I took out a small loan that I can’t afford to repay; what should I do?
Finding yourself in a position where you’re unable to afford your monthly repayments can be worrying. While it might be the last thing you feel like doing, it’s very important to contact your lender and explain the situation. They are not there to judge your circumstances and will be keen to work with you to put a suitable plan in place which could help to relieve some of the pressure.
Get free financial advice
If you’re worried about your financial situation, please know that you can access free, impartial advice from the following charities and organisations: StepChange, MoneyHelper, Citizens Advice, and National Debtline.